Adjug, which has investors including former Bebo-backer Balderton Capital, was founded in 2007 by former Gumtree and eBay senior executive Michael Stephanblome and co-founder of pay-per-click ad pioneer Espotting Satish Jayakumar.

The company, which allows media owners and brands to trade advertising space online, has offices in Munich and Bangalore employing more than 50 people.

In 2009 Adjug investor Tomorrow Focus, the German internet media company whose main shareholder is Love It! and Wedding magazine publisher Hubert Burda, increased its holding in Adjug to 56%.

The acquisition by Dentsu, which also owns a stake in French advertising giant Publicis Groupe, is the latest move by the Japanese advertising giant as it looks to increase its digital capability.

In June it acquired Steak Digital, the London-based digital agency network founded in 2005, which has about 100 staff and offices in New York and Melbourne.

Steak, co-founded by Oliver Bishop, specialises online search and display but also offers ad creative and social media services.

In January Dentsu acquired Dusseldorf-based digital creative agency Social Thinkers.

Dentsu and US marketing services giant Omnicom have been tipped by analysts as the potential bidders with the most operational synergies, and fewest trust issues, if UK-based media buying business Aegis Media comes up for sale.

The deal has been struck by IgnitionOne, the international digital marketing technology company owned by Dentsu, with Tomorrow Focus continuing to hold a 20% stake in AdJug and advising on European expansion.

"The online ad market is overcrowded with complicated and overlapping technologies," said Will Margiloff, chief executive of IgnitionOne. "With this deal, IgnitionOne is simplifying digital marketing for agencies and brands."

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